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CASS 11.3 Responsibility for CASS operational oversight

CASS small debt management firm other than a not-for-profit debt advice body

CASS 11.3.1R
  1. (1)

    A CASS small debt management firm, other than a not-for-profit debt advice body, must allocate to a director or senior manager1 responsibility for:1

    1. (a)

      oversight of the firm's operational compliance with CASS 11;1

    2. (b)

      reporting to the firm's governing body in respect of that oversight; and1

    3. (c)

      completing and submitting a CCR005 return in accordance with SUP 16.12.29CR.1

  2. (2)

    A firm that is not a relevant authorised person must make the allocation in (1) to a director or senior manager approved to perform a significant influence function in relation to that firm.1

CASS 11.3.1AG

1CASS 11.3.3G(5) to (11)2 also apply to a CASS small debt management firm and the function in CASS 11.3.1R. However:

  1. (1)

    the function in CASS 11.3.1R is not an FCA specified significant-harm function; and

  2. (2)

    the person performing that function will not necessarily be subject to the employee certification regime described in SYSC 5.2 (Certification Regime).

CASS small debt management firm that is a not-for-profit debt advice body

CASS 11.3.2R

A CASS small debt management firm that is a not-for-profit debt advice body must allocate to a director or senior manager:

  1. (1)

    oversight of the firm's operational compliance with CASS 11;

  2. (2)

    reporting to the firm's governing body in respect of that oversight; and

  3. (3)

    completing and submitting a CCR005 return in accordance with SUP 16.12.29C R.

CASS large debt management firm: the CASS operational oversight function (CF10a)

CASS 11.3.3G
  1. (1)

    CASS 11.3.4R describes the FCA controlled function known as the CASS operational oversight function (CF10a) in relation to CASS large debt management firms, including not-for-profit debt advice bodies.1

  2. (2)

    As a consequence of CASS 11.3.4R (in conjunction with SUP 10A.4.1R and SUP 10A.7.10R), in a CASS large debt management firm (including a not-for-profit debt advice body fitting into that category) the function described in CASS 11.3.4R is required to be discharged by a director or senior manager.1

  3. (3)

    In the case of a firm that is not a relevant authorised person, the director or senior manager in (2) should be an approved person under the approved persons regime provided for in SUP.

    1
  4. (4)

    However, the CASS operational oversight function does not apply to a relevant authorised person.1

  5. (5)

    For a firm that is a relevant authorised person, the function in CASS 11.3.4R is not a separate controlled function and performing that function does not require approval as an approved person.1

  6. (6)

    A relevant authorised person must allocate overall responsibility for the firm’s compliance with CASS to one of its SMF managers (see SYSC 4.7.5R). That responsibility is an “FCA-prescribed senior management responsibility”. The full list of FCA-prescribed senior management responsibilities is in the table in SYSC 4.7.7R.1

  7. (7)

    A relevant authorised person may allocate the function in CASS 11.3.4R to the SMF manager in (6).1

  8. (8)

    A relevant authorised person may allocate the CASS FCA-prescribed senior management responsibility described in (6) to an SMF manager who does not perform any other function coming within the FCA approved persons regime for relevant authorised persons. See SUP 10C.7 (Other overall responsibility function (SMF18)) for details.1

  9. (9)

    A relevant authorised person may choose to allocate the function in CASS 11.3.4R to someone who is not an approved person and SMF manager. If so:1

    1. (a)

      that person will be subject to the employee certification regime described in SYSC 5.2 (Certification Regime);1

    2. (b)

      that person will be subject to supervision by the SMF manager in (6); and1

    3. (c)

      the function in CASS 11.3.4R will be the CASS oversight FCA specified significant-harm function in SYSC 5.2.32R.1

  10. (10)

    Broadly speaking, paragraphs (1) to (9) apply to a third-country relevant authorised person, with certain differences:2

    1. (a)

      SYSC 4.8.6R and SYSC 4.8.9R apply instead of SYSC 4.7.5R and SYSC 4.7.7R;2

    2. (b)

      SUP 10C.8 applies instead of SUP 10C.7;2

    3. (c)

      the other local responsibility function (SMF22) applies in place of the other overall responsibility function (SMF18).2

  11. (11)
    1. (a)

      The position of an incoming EEA firm that has a top-up permission is slightly different.2

    2. (b)

      The firm may choose to allocate the function in CASS 11.3.4R to an SMF manager.2

    3. (c)

      The firm may instead choose to allocate the CASS function to someone who is not an SMF manager.2

    4. (d)

      Where (c) applies, the person performing the function in CASS 11.3.4R will fall into the certification regime.2

    5. (e)

      FCA-prescribed senior management responsibilities do not apply to an incoming EEA firm that has a top-up permission. There is no requirement in SYSC 4.7 or SYSC 4.8 that an SMF manager in an incoming EEA firm should have overall responsibility for CASS.2

    6. (f)

      Having responsibility for CASS may fall within the scope of the EEA branch senior manager function (SMF21).2

    7. (g)

      However, having responsibility for CASS may not fall into any controlled function.2

CASS 11.3.4R

A CASS large debt management firm must allocate to a director or senior manager the function of:

  1. (1)

    oversight of the operational effectiveness of that CASS debt management firm's systems and controls that are designed to achieve compliance with CASS 11;

  2. (2)

    reporting to the CASS debt management firm's governing body in respect of that oversight; and

  3. (3)

    completing and submitting a CCR005 return to the FCA in accordance with SUP 16.12.29C R.

CASS 11.3.5R

If, at the time a CASS debt management firm that is not a relevant authorised person 1becomes a CASS large debt management firm in accordance with CASS 11.2.8 R, the firm is not able to comply with CASS 11.3.4 R because it has no director or senior manager who is an approved person in respect of the CASS operational oversight function, the firm must:

  1. (1)

    take the necessary steps to ensure that it complies with CASS 11.3.4 R as soon as practicable, which must at least include submitting an application for a candidate in respect of the CASS operational oversight function within 30 business days of the firm becoming a CASS large debt management firm; and

  2. (2)

    until such time as it is able to comply with CASS 11.3.4 R, allocate to a director or senior manager performing a significant-influence function responsibility for:

    1. (a)

      oversight of the firm's operational compliance with CASS 11;

    2. (b)

      reporting to the firm's governing body in respect of that oversight; and

    3. (c)

      completing and submitting a CCR005 return to the FCA in accordance with SUP 16.12.29C R.

CASS 11.3.5AG
  1. (1)

    1CASS 11.3.5R provides a grace period for a firm that is not a relevant authorised person to apply for someone to be approved to perform the CASS operational oversight function.

  2. (2)

    There is no equivalent to CASS 11.3.5R for a relevant authorised person, because a person does not need specific FCA approval before carrying out the function. This is explained in (3) to (5), below.

  3. (3)

    As explained in CASS 11.3.3G, the function in CASS 11.3.5R is not, by itself, a controlled function.

  4. (4)

    Therefore, if an approved person is to perform the function for a relevant authorised person, it can be allocated to any director or senior manager who is already an approved person who is suitable to carry it out.

  5. (5)

    If the function is to be carried out by a certification employee:

    1. (a)

      FCA approval is not needed because performance of a role that falls into the certification regime does not require FCA approval;

    2. (b)

      the firm should:

      1. (i)

        either issue them with a certificate under SYSC 5.2 (Certification regime) before the firm becomes a CASS large debt management firm; or

      2. (ii)

        give the function to a suitable approved person pending issue of the certificate.

Record of responsibility for CASS operational oversight

CASS 11.3.6R
  1. (1)

    Subject to (2), a CASS debt management firm must make and retain an appropriate record of the person to whom responsibility is allocated in accordance with, as applicable, CASS 11.3.1 R, CASS 11.3.2 R, and CASS 11.3.4 R.

  2. (2)

    A CASS small debt management firm must make and retain such a record only where it allocates responsibility to a person other than the person in that firm who performs the compliance oversight function.

  3. (3)

    A CASS debt management firm must ensure that a record made under this rule is retained for a period of five years after it is made.